Daily Market Outlook, November 29, 2022 

‘Bullard Breakdown Reverses On Improved China Sentiment…’

Global equity markets were once again rocked by Fed official comments that underpinned a hawkish view, with members supporting the higher for longer rate path, however, markets have stabilised overnight with the majority of Asian equity markets trading higher this morning, the rebound appears to be prompted by some cooling in Chinese tensions as police kept protests to a minimum, and further positives were taken as Chinese health authorities announced an increase in the pace of vaccination amongst the over 80’s, as Health Officials seek to avoid further excessive Covid restrictions. In earnings released this morning, Easyjet reported better-than-expected revenues and improved pre-tax loss of 178mln versus an expected 184.9mln, the company highlighted that operational performance in Q4 is better than performance seen in Q4 2019, and that Q1 23 bookings look positive with Easter ticket sale a standout.

On the data front for the day ahead, the focus in the UK will be on bank lending data which is expected to show a decline given the recent rate increases, specifically markets expect mortgage lending to bear the brunt of the pressure as the data period covers the disastrous mini-Budget period when rates spiked. BoE’s Bailye is also set to speak today in th ehosue of Lords comments will be parsed for any further clues as to the Banks rate path. In the Eurozone, CPI updates from Germany and Spain will provide some timely insight into what markets can expect from the broader Eurozone print tomorrow. In the US Focus will be on consumer confidence surveys which are expected to have declined for the second month in a row. US house prices are also expected to have taken another hit as the housing market in the US continues to cool, with Fed officials pointing to a higher terminal rate for interest rates, markets expect a continued buyers strike. 

Overnight Headlines

  • Heavy Police Presence Thwarts Another Night Of China Protests

  • US Dollar Holds Firm As China’s Covid-Related Worries Weigh

  • Oil Surges As Speculation OPEC+ Will Cut Production Intensifies

  • Japan’s Job Market Remains Tight, Keeping Pressure On Wages

  • Japan Retail Sales Up For 8th Month On Tourism Reopening

  • NZIER Sees RBNZ Cash Rate Peaking At 5% In 2023

  • Biden Calls On Congress To Pass Legislation To Avert Rail Shutdown

  • Fed’s Barkin Urges Slowing Rate Hikes But Higher Destination

  • Fed Officials Say More Rate Hikes Coming; Williams Flags Path To Cuts

  • BOE Starts Sales Of Bonds Bought In UK Market Mayhem

  • US Dollar Holds Firm As China’s Covid-Related Worries Weigh

  • Oil Surges As Speculation OPEC+ Will Cut Production Intensifies

  • EU Discusses Russian Oil Price Cap As Low As $62 As Talks Slow

  • Hong Kong Stocks Jump 4% Ahead Of China’s Covid Briefing

  • Adobe Analytics: Retailers On Track For Record Cyber Monday

  • Amazon Launches Powerful New Chip To Take On Intel And AMD

  • Microsoft Likely To Offer EU Concessions Soon In Activision Deal

  • Sony To Supply Apple With Advanced Image Sensor For Next iPhone

Technical & Trade Views

SP500 Bias: Bullish Above Bearish Below 3940

Technicals

  • Primary support is 3940

  • Primary upside objective is 4120

  • Next pattern confirmation, acceptance above 4050

  • Failure below 3930 opens a test of 3900

  • 20 Day VWAP bullish, 5 Day VWAP bearish

EURUSD Bias: Bullish Above Bearish below 1.0340

Technicals

  • Primary support is 1.0340

  • Primary upside objective is 1.0620

  • Next pattern confirmation, acceptance above 1.0485

  • Failure below 1.03 opens a test of 1.0220

  • 20 Day VWAP bullish, 5 Day VWAP bullish

  • Today’s New York Cut Option Expiries: 1.0265 (451M), 1.0275-80 (260M), 1.0375-80 (428M), 1.0400 (240M), 1.0445-50 (861M), 1.0465-75 (568M), 1.0650 (235M)

GBPUSD Bias: Bullish Above Bearish below 1.1950

Technicals

  • Primary support is 1.1950

  • Primary upside objective 1.22

  • Next pattern confirmation, acceptance above 1.21

  • Failure below 1.19 opens a test of 1.1770

  • 20 Day VWAP bullish, 5 Day VWAP bullish

  • Today’s New York Cut Option Expiries: N/A

USDJPY Bias: Bullish above Bearish Below 140

Technicals

  • Primary resistance is 140

  • Primary downside objective is 136

  • Next pattern confirmation, acceptance below 138

  • Acceptance above 142.20 opens a test of 143

  • 20 Day VWAP bearish, 5 Day VWAP bearish

  • Today’s New York Cut Option Expiries: 137.50-55 (448M), 139.00 (550M), 139.70 (277M), 140.00 (244M)

AUDUSD Bias: Bullish Above Bearish below .6650

Technicals

  • Primary support is .6650

  • Primary upside objective is .6900

  • Next pattern confirmation, acceptance above .6775

  • Failure below .6660 opens a test of .6600

  • 20 Day VWAP bullish, 5 Day VWAP bullish

  • Today’s New York Cut Option Expiries: 0.6620-25 (248M), 0.6727 (387M) 

  • USD/CAD: 1.3275 (514M), 1.3350-60 (260M)

BTCUSD Bias: Intraday Bullish Above Bearish below 16100

Technicals

  • Intraday 16100 is primary resistance

  • Primary upside objective is 17000

  • Next pattern confirmation, acceptance below 16750

  • Failure 16000 opens a test of 15500

  • 20 Day VWAP bearish, 5 Day VWAP bullish